Helical Bar Regulatory News (HLCL)

23 July 2020

Helical today provides an update covering its trading activity for the period 1 April 2020 to 22 July 2020 ("the Period").

Commenting on the Company's activities, Gerald Kaye, Chief Executive, said:

"Today's Trading Update is issued against a background of growing optimism that the immediate health threat presented by Covid-19 is receding, permitting the continued re-opening of the UK economy. With city centre retailers and food and beverage operators now open, it is vitally important to the economies of the cities in which we operate, London and Manchester, as well as across the country, that businesses act on the Government's encouragement to return to their offices to work. This will generate considerable and much needed economic activity with a positive knock on effect across a range of sectors.

"Across our portfolio, we are seeing a number of occupiers return, with others making plans to do so after the summer. We continue to support our tenants and are beginning to see a recovery in the letting market, evidenced by some encouraging discussions on the vacant space in our portfolio.

"We believe that the attraction of our high-quality portfolio of new or recently refurbished Grade A offices will endure with businesses continuing to seek well-located and accessible properties, which incorporate the latest in sustainable building design, offer state of the art technology and have occupier health and well-being at their core."

Operational Performance

Portfolio Matters

· In our 50:50 joint venture with AshbyCapital, we exercised the option under the Development Agreement with The City of London to secure a new 150-year lease at 33 Charterhouse Street, London EC1. The c. 200,000 sq ft office development is targeted to complete in Summer 2022.

· On 28th April 2020 we completed the sale of 90 Bartholomew Close, Barts Square, London EC1 to La Francaise Real Estate Partners International, a pan-European investment business acting on behalf of a French collective real estate investment vehicle. The disposal price of £48.5m reflected a net initial yield of 3.92% (£1,594 per sq ft capital value).

· At Phase One of Barts Square, London EC1, we have now completed the sale of 140 apartments and of the remaining four apartments, three have either exchanged or are under offer leaving just one available. At Phase Two, completion has been achieved on 51 apartments. A further six apartments have either exchanged or are under offer, including 56 West Smithfield, leaving 35 apartments available.

· In Manchester, the refurbishment of the Fourways reception and atrium has now been substantially completed, providing new feature link bridges between the office floors and modernising the reception.

Rent Collection

· As at 22 July 2020, we have collected 77.3% of the June quarter rent, with agreements in place for a further 13.6% to be paid in instalments in the period leading up to the September quarter day. We have granted rent free periods on 4.7%, mainly in respect of F&B tenants. As a result, we anticipate that by the end of the June quarter we will have collected between 90.9% and 95.3% of all contracted rent.

Financing

· During the Period, we secured a £140m debt facility from Allianz to finance the development of 33 Charterhouse Street, London EC1. The facility has a four-year term, with the option to extend to a fifth year. It is anticipated that the first drawdown will be in Q3 2020, from which point all future development costs will be fully funded by the facility.

· At 22 July 2020, the Group had £67m of available cash, £531m of investment facilities of which £360m was drawn down and £88m of development facilities (Helical's share) of which £11m was drawn down.

· As a result of the strong June quarter rent collection, the Group continues to have substantial headroom on all of its covenants.

Dividend

The final dividend for the year ended 31 March 2020 of 6.00p, if approved by Shareholders at the AGM later today, will be paid on 27 July 2020. This will take the total dividend for the year to 8.70p (2019: 10.10p).

Board Changes

At today's Annual General Meeting and subject to her re-election, Sue Farr will assume the role of Chair of the Remuneration Committee. Sue will succeed Richard Cotton, who has been Chair of the Remuneration Committee since 11 July 2019. Richard will remain as the Senior Independent Director and a member of the Board and its Committees.

For further information, please contact:

Schelical@fticonsulting.com